Why customer service should be a priority in B2B markets

Helped by technology, companies that serve consumers have made great strides in customer service in recent years. Those that serve other businesses, however, have lagged.

According to McKinsey, while business-to-consumer (B2C) companies enjoy an average customer service score in the 65 to 85 per cent range, business-to-business (B2B) company scores average less than 50 per cent.And as B2B customer expectations rise, the gap between the two offerings likely will widen.

One challenge is that the long-term relationship building, scoping and negotiating that once underpinned B2B sales is being replaced by the more immediate XaaS model (X-as-a-service), where clients can do their own research, choose cost-competitive options and use them only when they need them.

The long-term relationship building, scoping and negotiating that once underpinned B2B sales is being replaced by the more immediate XaaS model

Organisations can adapt to this business model in a positive way, says Jenniffer Breitenstein, senior vice president of global marketing and analyst relations at software company ServicePower. “The servitisation of B2B, often enabled by the cloud, opens up immense opportunity for organisations,” she says. “You can implement offerings that were once products much more quickly, provide new services that weren’t previously possible, and open up new revenue streams.”

B2B customers are already demanding a better experience, as highlighted in a McKinsey survey of 1,000 B2B decision-makers, where a lack of speed in supplier was identified as the number-one “pain point”, mentioned twice as often as price.

Furthermore, by accelerating and simplifying these interactions companies can boost their win rate by up to 40 per cent and lower associated service costs by up to 50 per cent, all the while reducing customer attrition by up to 15 per cent.

KPMG Nunwood’s Winning in the Moments that Matter report on the state of customer experience for B2B companies reveals that the critical moments that define a successful B2B relationship are increasingly less about price and product features and much more about the customer experience.

Unlike B2C, B2B customers are not buying for personal gratification; they are buying as part of their job and need it to be as efficient and easy as possible

Many B2B programmes attempt to implement B2C strategies but fail because they are not tailored to customer requirements. Unlike B2C, B2B customers are not buying for personal gratification; they are buying as part of their job and need it to be as efficient and easy as possible.

“B2B is different to B2C,” says Brian Green, head of Europe, Middle East and Asia sales at Magento Commerce. “Unique pricing agreements, different buyer authority and approval levels, the ability to re-order from bill of materials or based on order history are integral to the B2B buyer journey and when tailored to an B2B organisation can act as a differentiator to competitors.”

B2B organisations must also understand the changing demographics of their business buyers. Mr Green adds: “In construction, for example, often seen as a laggard in adopting technology and positioned last by Forrester in their industry analysis of organisations implementing B2B ecommerce, the buyers are young millennials who are absolutely focused on using mobile technology in the field.”

In many ways delivering a great B2B customer experience can be more challenging than B2C: just one dissatisfied account walking away can deal a devastating blow to a company.

This makes it incredibly important to focus on customer retention methods, says Jenny Burns, chief executive of consultants KBS Albion. “In addition, customers of B2B businesses want to be partners, working in collaboration to deliver results and not be on the receiving end of loads of marketing. This requires a new capability to build deeper relationships and leaders who are visibly involved in resolving problems quickly.”

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